The London-Brussels Nexus: City views on the Euro crisis

The euro crisis has loomed large on the EU policy agenda for more than a year now. But the financial investors who have played a central role in it remain to a large extent a foreign community in the perception of many public policymakers, in Brussels as in national capitals – sometimes scapegoated and often misunderstood, even as they are called upon to provide financing. The limited presence of market-savvy individuals in key policy decision-making circles also arguably restricts the scope for adopting innovative solutions to the problems at hand.

This fourth and last session of our “London-Brussels Nexus” event series aimed at looking at the crisis through the eyes of London-based investors. How well was the crisis handled, when seen from the trading floor or strategy conference room? How significant will be the shift from EFSF to ESM? What is the potential effect of ‘collective action clauses’? To which extent can ‘soft’ or ‘voluntary’ restructurings be part of the solution? More broadly, what can make bonds issued by periphery countries attractive again as an investment proposition?

The guest speakers were John Nugée, Senior Managing Director of State Street Global Advisors (SSgA) and Justin Knight, head of European Fixed Income Strategy at the investment bank UBS, based in London. The discussion was moderated by Nicolas Véron, senior fellow at Bruegel and visiting fellow at the Peterson Institute for International Economics in Washington.